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43 Cards in this Set

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  • Back
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Truth in Lending Act

Consumer protection act intended to force lenders to be truthful in their advertising; implemented by Regulation Z

Physical Characteristics of real estate

Immobility, Indestructibility, Uniqueness (non homogeneity)

Negligent Representation

Misrepresentation occurring when the broker should have known that the statement about a material fact was false.

Bundle of Legal Rights

Ownership of legal rights: control, possession, use, disposition, enjoyment

Replacement Cost

Current cost to reconstruct a building to serve the same function but not an exact duplicate of the original.

Real Property

Interests, benefits, and rights inherent in real estate ownership.

Land plus property plus bundle of rights


Ownership of the airspace of a unit, plus undivided interest in common elements.


Multi-tenant building owned by trust or corporation; tenants own share of stock and proprietary lease.

Economic Characteristics of Real Estate

Scarcity, Improvements, Permanence of Investment, Area Preference (location)

Planned Unit Development (PUD)

Planned combination of diverse uses, such as housing, recreation, and shopping in one planned subdivision or development.


Change personal property to real property, such as mixing sand, stone, and cement to make a sidewalk.

Not like the Mashantuckets

Price Fixing

Brokers conspiring to set fixed compensation rates


In a listing, a clause that states that the seller and broker will not sue each other for any incorrect information supplied by one to the other


Place where goods are bought and sold, price is established

Capital Gain

Profit earned from the sale of an asset


Man-made attachment to the land, such as building, streets, utilities


Bringing together parties interested in a real estate transaction


Right given by law to certain creditors to have their debts paid out of the property of a defaulting debtor, usually by court sale

Affidavit of Title

Written statement made under oath, that grantor identifies himself and marital status, certifies that there are no new defects on title


Intentional misrepresentation of a material fact in order to harm or take advantage of another person

Multiple Listing Service (MLS)

Marketing organization in which brokers share information and commission with other brokers; Sellers gain because of greater exposure to larger market

Rules and Regulations

Licensing authority to provide for administering the law and set operating guidelines for licensees. Have the same force and effect as any law.

Marketable Title

Good or clear title, reasonably free from risk of litigation over possible defects

Good Faith Estimate (GFE)

Settlement costs that borrower is likely to incur; must be given within three business days after loan application; should be pretty accurate.


One who hires; broker (principal) hires salespeople, seller (principal) hires the broker/agent, or buyer (principal) hires broker/agent


Charging interest in excess of the maximum rate; often residential first mortgage loans are exempt from such laws


Formal declaration (by someone like a notary public) that a signature is both voluntary (no force) and genuine (no forgery)

Adverse Possession

Possession of another's land, as if the owner, for a statutory period which may lead to acquiring title

Bilateral vs Unilateral Contract

Bilateral: both parties are legally bound to act as promised (lease, purchase agreement)

Unilateral: only one party is bound to act (option, promissory note)


Transfer in writing of interest in a bond, mortgage, or lease

Ginnie Mae

HUD division, corporation without stock; administers special assistance programs and works in tandem with Fannie Mae by guaranteeing payments

Discount Point

Unit of measurement used for various loan charges; one point equals one percent of the loan amount

Standard Homeowner's Insurance

Insurance package that covers residential property owner against financial loss from fire, theft, public liability, etc

Property Management

Management of another's property for compensation

National Flood Insurance Act

Requires flood insurance when financing with federally related loans on properties located in flood-prone areas


Changing of real to personal property, such as cutting down a tree or removing a stained glass window


Person dies without a valid will; his or her property will pass to heirs as provided in the state law of descent


Splitting a single property into smaller parcels

Abstract of Title

Certification by abstractor that condensed history of title to a particular parcel of real estate, including conveyances and encumbrances, is correct

Adjustable Rate Mortgage (ARM)

Loan that has a fluctuating interest rate, usually one tied to a cost of funds index; the cost of doing business is the margin that stays fixed and is added to the base rate

Acceleration Clause

Clause in mortgage or deed of trust that can be enforced to make the entire debt immediately if borrower defaults

Statute of Frauds

State law requires certain instruments, such as deeds, real estate contracts, and certain leases to be in writing to be legally enforceable

Quiet Enjoyment Covenant

Clause in deed guaranteeing that the grantee's title will be good against third parties who might bring court action.